News
Novogratz’s Galaxy Digital tokenizes a 316-year-old violin to repay the loan
- Mike Novogratz’s company tokenized an 18th-century violin as collateral against a loan, Galaxy said in a press release.
- Tokenization of the instrument is a way to increase liquidity and make it more available to interested investors.
- The multi-million dollar loan agreement was reached with Animoca Brands co-founder Yat Siu.
Thank you for signing up!
Access your favorite topics in a personalized feed on the go. download the application
By clicking “Subscribe”, you agree to our Terms of Service AND Privacy Policy. You can unsubscribe at any time by visiting our Preferences page or by clicking “Unsubscribe” at the bottom of the email.
Cryptocurrency-focused firm Galaxy Digital has tokenized an 18th-century violin, creating a blockchain version of the instrument to be used as collateral for a multimillion-dollar loan. Bloomberg reported.
According to a Press releasethe violin is a 1708 Stradivarius that was once owned by Russian Empress Catherine the Great, purchased last year at auction by Animoca Brands co-founder Yat Siu and valued at more than $9 million.
He is now in the care of Galaxy, who gave Siu a loan, and is using the violin to support him. In addition to this, the company has created a non-fungible token of the instrument, which also serves as collateral.
“By starting with high-end assets like this violin, we are creating a process that will transform how an entire range of assets are managed, valued and traded in a digital economy,” Galaxy CEO Michael Novogratz said in the release press.
For those who don’t know, tokenization is a growing practice, where traditional real-world assets are packaged as tokens to be traded on blockchain platforms. According to an estimate from late 2023, the total value of on-chain real assets has already exceeded limits 118 billion dollars.
Making things digital means these assets benefit from greater liquidity and can be fractionated or divided for more convenient trading.
Speaking to Bloomberg, Siu indicated that tokenizing the violin is not a necessary step, but is a way to gain additional liquidity. You added that you are available to possibly split the tokenized instrument, allowing investors to purchase a credit. However, there are currently no plans to do so yet.
For Galaxy’s part, offering such loans is a way to reach new clientele, which has gained from the growth of cryptocurrency markets, Bloomberg said. Otherwise the company already has a division that provides loans.